CURRENT INTELLIGENCE BULLETIN - 1955/12/28

• Document Type: SPECIALCOLLECTION
• Collection: Current/Central Intelligence Bulletin Collection
• Document Number (FOIA) /ESDN (CREST): 03020471
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 7
• Document Creation Date: September 20, 2019
• Document Release Date: September 26, 2019
• Publication Date: December 28, 1955

APProved for Release: 2019/09/16 C03020471
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28 December 1955 3.5(c)
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Copy No. 103
CURRENT
INTELLIGENCE DOCUMENT NO ffr ur/
NO ORANGE IN CLASS.
OE0LASSWIEO
BULLETIN CLASS. CHANGED TO: T$ S C
NEXT REVIEW DATE: 2010
AUTH: HR 70-2
DATE; _0114EVIEWER: JL
OFFICE OF CURRENT INTELLIGENCE
CENTRAL INTELLIGENCE AGENCY
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.CONTENTS
1.. 1.. THE 1956 SOVIET BUDGET
(page 3).
2. NO POWER CRISIS SEEN IN SOVIET LEADERSHIP
(page 4).
3. RHEE ATTEMPTING TO INVOLVE UNITED STATES OVER
FISHING INCIDENT WITH PEIPING (page 5).
28 Dec 55
THE ARAB-ISRAELI SITUATION
(Information as of 1700, 27 December)
(page 6)
Current Intelligence Bulletin Page 2
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%OW VIEW
1. THE 1956 SOVIET BUDGET
Comment on:
Initial examination of the 1956 Soviet
budget indicates no substantial policy
changes. In spite of the announced re-
duction in defense expenditures, it cannot be said that a
major change has been made in the level of military end-
item procurement. The varying reductions in wholesale
prices during 1955, however, make exceptionally complex
an accurate comparison of 1955 and 1956 figures.
Stated defense expenditures are to de-
cline from 112.1 billion rubles planned for 1955 to 102.5
billion for 1956. As much as half of this cut may be ac-
counted for by the demobilization of 640,000 men announced
earlier this year and the savings expected from the retail
price cut announced for 1956. Lower procurement costs
resulting from wholesale price cuts in industry and reduc-
tions in unit costs of some military items indicate that end-
item procurement will not be reduced in proportion to the
announced reduction in defense expenditures and suggest
that procurement may even increase in real terms.
The relative predominance of heavy over
light industry remains unchanged. Capital investment will
increase 15 percent over 1955: the share for heavy industry
will rise from 56 percent last year to 60 percent, while the
share for the consumer goods industries will fall to below
5 percent, approximately the percentage allocated in the 1952
budget. The total allocation to agriculture will fall from 65.1
to 55. 6 billion rubles, again partly because of lower wholesale
prices, although investment in agriculture will remain at a
high level. (Prepared by ORR)
28 Dec 55
Current Intelligence Bulletin Page 3
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2. NO POWER CRISIS SEEN IN SOVIET LEADERSHIP
Ambassador Bohlen in Moscow has
seen no evidence to justify specula-
tion that a "new crisis of power" ex-
ists in the Soviet leadership. He
considers it unlikely that Khrushchev and Bulganin would
have absented themselves for a month, leaving Malenkov
and Molotov behind, if serious internal differences were
developing.
No clear pattern is discernible in the
recent changes in provincial party secretaries. The am-
bassador assumes, however, that there are differences
within the leadership and accepts the possibility that dur-
ing the party congress in February or even during the
current Supreme Soviet session there may be changes in
the status of key individuals.
Comment While a power crisis does not appear
to be imminent, several officials who
in the past have been associated with Khrushchev have been
appointed to party and government posts, suggesting he has
been gaining control of key positions throughout the country.
Kirushchev has accomplished a restaffing
of the central committee "apparatus" during the past year.
Consolidation of his control of this vital headquarters staff
suggests that he has been eliminating the basis for any oppo-
sition to his dominant position within the framework of "col-
lective leadership."
28 Dec 55
Current Intelligence Bulletin Page 4
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3. RHEE ATTEMPTING TO INVOLVE UNITED STATES OVER
FISHING INCIDENT WITH PEIPING
President Rhee is attempting to ex-
ploit the clash between a South Korean
coast guard vessel and Chinese Com-
munist fishing boats in the Yellow Sea
on 25 December to secure American
intervention against the Chinese Com-
munists. He is
to request General
Lemmtzer, as UN commander, to make a
formal protest to the Chinese and obtain the release of four
seized Korean coastguardmen.
Rhee has also ordered his propaganda
directorate to describe the encounter as the first of a series
of such incidents in a "Tokyo-Peiping-Pyongyang campaign
of provocation and aggression against South Korea."
Comment The clash took place on the high seas ap-
proximately 115 miles southwest of Korea,
but within Rhee's unilaterally proclaimed "fisheries line."
Communist China's determination to pro-
tect seasonal fishing operations in the Yellow Sea makes prob-
able further incidents with Rhee's coast guard. With the ex-
ception of the coast guard, regular South Korean forces are
under control of the UN commander.
Rhee may hope to involve the United States
in this incident with Peiping as a new step in his effort to gain
Washington's support in his long-standing fisheries dispute with
Tokyo.
28 Dec 55
Current Intelligence Bulletin Page 5
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THE ARAB-ISRAELI SITUATION
(Information as of 1700, 27 December)
No significant military action has been
reported, but sporadic firing across the Egyptian-Israeli and
Syrian-Israeli frontiers has been resumed after a brief respite
An Israeli military spokesman has alleged that Egyptian troops
in the Gaza area are being reinforced.
The announcement that Egypt and Saudi
Arabia have established a joint military command under Egyp-
tian general Amir is not likely to make Saudi-Egyptian co-
operation significantly closer. The move provides a paper
organization for the defense pact between the two countries
signed last October, but the Saudis will presumably limit their
contribution to money and some men for training in Egypt. Amir's
authority over Saudi forces probably is much more restricted
than his control over Syrian forces under the joint Egyptian-
Syrian command.
28 Dec 55
Current Intelligence Bulletin Page 6
-SteREL-T
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